Brief History of U.S. Homestead Laws
Today's homestead laws, which help homeowners avoid losing their home when facing bankruptcy, hardly resemble the homestead laws of the 19th century. The federal Homestead Act of 1862 encouraged settlers to move west by offering free land to citizens under limited restrictions (although much of this land already was occupied by Native Americans).
State homestead laws in the present day are much different and used by homeowners to protect a limited portion of their home's equity from confiscation by creditors. The main thrust of these laws is to prevent homelessness, while continuing to encourage home ownership. State laws typically designate a certain amount of acreage or a home's value that may be claimed as a homestead and therefore protected.
Overview of Minnesota Homestead Protection Law
Minnesota statute allows homeowners to claim up to $390,000 in property value, or $975,000 if agricultural, as a "homestead." State law limits this exemption to 160 acres, which in practice may apply to farms, but has removed what was once a half-acre limit on property within city limits. Minnesota does not allow married couples to double the homestead exemption amount as many other states do, but the exemption amount is already quite generous compared to other states.
The following chart provides a snapshot of Minnesota homestead law. See Prevent and Manage Foreclosure FAQs for more details.
| Code Section | 510.01, et seq. |
| Max. Property Value That May Be Designated 'Homestead' | $390,000, or if primarily agricultural, $975,000 |
| Maximum Acreage (Urban) | No statutory limit |
| Maximum Acreage (Rural) | 160 acres |
Note: State laws are constantly evolving and subject to change through new legislation, court decisions, or ballot initiatives. We strive to keep these pages up-to-date, but you may also want to contact a Minnesota real estate attorney or bankruptcy lawyer, or conduct your own legal research to verify the state law(s) you are researching.
Federal Homestead Protections
The federal government also provides homestead protections for homeowners filing for Chapter 7 bankruptcy, but the limit in value is $22,975 (as of 2014). But since you cannot claim homestead exemptions under both jurisdictions, it makes sense to choose Minnesota's exemption instead.
Research the Law
Minnesota Homestead Laws: Related Resources
